Senate Democrats want to beef up Medicare by closing a tax break currently used by the rich – By Joseph Zeballos-Roig (Business Insider) / July 7, 2022
- Democrats intend to levy a tax on some rich Americans to extend Medicare’s solvency.
- It would apply to high-earning individuals and couples who earn money from certain businesses.
- Democrats are still ironing out how to pay for other parts of a $1 trillion package.
Senate Democrats are eyeing a new tax on rich Americans to extend Medicare’s lifespan as part of a slimmer economic spending bill they hope to pass by the end of the month.
Under the proposal, Democrats will impose a 3.8% tax on some high-earners who draw income from so-called “pass-through” businesses, per a source familiar with the ongoing negotiations. That would delay a shortfall in the Medicare hospital trust fund to 2031 from 2028, providing a three-year extension for benefits being fully paid.
The tax would apply to individuals who earn $400,000 or more annually and couples, trusts, and estates making at least $500,000.
